How to choose between free and paid marketing channels

Free or paid marketing channels

This is a guest post by Patrick Rauland, co-founder of the Lift Off Summit, a free virtual conference for growing ecommerce businesses.

When someone starts an online store they usually look at their bank account and if they have money they go with ads. And if they don’t they go with free marketing channels. And while this makes sense it isn’t the best way to think about marketing and getting traction for your store.

In this post, I break down the real differences between paid marketing channels and free marketing channels to help you figure out the best route to help your growing online business reach the next level of success.

The Free Channels

There are a lot of free channels you can use. Just to name a few there are:

  • Search Engine Optimization (SEO)
  • Content Marketing
  • Facebook pages
  • Twitter
  • Instagram
  • Pinterest
  • Video marketing (YouTube)

And all of these can drive traffic to your store. But you have to start building an audience on these channels first and figure that out before you start driving serious traffic to your store.

This can be especially hard on some platforms like Facebook that suppress organic page posts and instead display ads.

Another problem is that these strategies usually take a lot of time. One of the most effective channels for my personal blog is SEO. But it took years to get enough organic traffic.

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The Paid Channels

There are just as many–if not more–paid channels. Here are a few:

What all of these have in common is that they can help you speed up the growth of your brand & store.

Speed Up Growth

Building something from scratch is hard. It’s hard and it’s slow. Even if you have a compelling message you might only get that message in front of a few new people each day. And only a fraction of those are ready to buy your product today.

Ads let you target the perfect audience. Facebook especially has robust targeting let you target interest, ages, genders, and locations. And you can target users at any point along the customer journey. Whether they’ve seen your site, visited a specific page, joined the newsletter, or added something to the cart.

When you can target the perfect audience you’re much more likely to make the sale. If you need 100 visitors to your website to make a sale. You might only need 50, 25, or maybe if you’re really good just 5 visitors to make a sale with ads.

With ads you don’t just pay for leads. You pay for hot leads.

What About Costs?

The cost of running ads can actually be quite low. I interviewed Facebook marketing expert Megan Adams for Lift Off Summit, she made a really good point about starting small and testing the results:

“In the beginning…start with $5 a day and see where that takes you. Or $100 a campaign.”

Amber Turril, Chief Funnel Operations Strategist at White Coat Digital said:

“You can start a $5/day campaign on Facebook and see where that goes. Or $10/day on Adwords.”

For $5 a day. That’s $125 a month. A very reasonable amount. Even if every single click-through fails you still learn something. You can tell which ads had the most compelling message based on their click through rates.

You can try different copy & different images to learn what call to actions are the best for your audience. And then apply that to your eCommerce site improving the conversion rate site-wide.

Break Even First

All of the platforms can show you the ROI on each of the ads. And with your first ad you’re likely to have a negative ROI – meaning you lost money on that ad. And that’s okay. You’re going to have ads that under perform.

It may take you a few weeks or maybe a month to get to the break even stage. And breaking even is the goal for someone just getting into ads.

Turrill continued:

“Will that one dollar turn into two dollars? It will. But first go for break even. And then go for that positive return on investment.”

Paying on the Backend

I’ve mostly been talking about ads so far – partly because they’re what everyone thinks of when they think of paid marketing channels. But also because they amplify what you’re already doing.

There is another strategy though. You can leverage someone else’s audience entirely and after each sale you can pay a commission. That means there are no upfront costs.

I’m talking about affiliate marketing & influencer marketing.

If you have a product that people are willing to promote (and if you don’t you should evaluate what you’re selling) then reach out to influencers in your space. Who is in your industry that knows your potential customers. They should know their wants, needs, and desires. And they should already have an audience.

If they understand your industry and they have an audience give them an affiliate code. And you can give them a commission on any sales made with their affiliate code.

I interviewed eCommerce entrepreneur Pippin Williamson for Lift Off Summit and he said:

“At it’s core it’s really other people saying good things about you.”

And I think that’s why this channel works so well. It’s a natural extension of word of mouth.

The Three Ways to Grow

In eCommerce there are three ways to grow:

  1. Get more customers
  2. Get your customers to purchase more (higher average order value)
  3. Get your customers to purchase more often

And when you’re a brand new store it’s basically just one: get more customers. That’s why I’m such a big fan of the paid channels.

They obviously have a cost to run. And you should always work on organic methods like SEO & content marketing. But while you’re gearing those up start playing with ads. You’ll usually see immediate results and can continue to grow & tweak.

Patrick Rauland is a public speaker, author, and blogger. He creates eCommerce content for LinkedIn Learning/ He loves helping people start their own businesses and take control of their own financial future.

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